Vilsack to Announce $500 Million to Expand Small, Medium Meat Processing Plants

USDA Secretary Tom Vilsack is expected to announce $500 million in new funds to expand meat processing capacity across the U.S. during a trip to Council Bluffs, Iowa, on Friday. According to Farm Journal Washington Correspondent Jim Wiesemeyer, the funds will be used to help small and medium processing operations.

Originally described by USDA as a "major announcement" during a planned trip to Nebraska, the announcement will instead take place at Rustic Cuts Butcher Shop in Council Bluffs, which is located just across the state line from Omaha. USDA says Vilsack will be joined by Congresswoman Cindy Axne (D-Iowa), where the two will make a visit to a farm, followed by a press conference at the Iowa butcher shop. 

Wiesemeyer reports several announcements will be made today, but among the potential "big" news is an announcement that $500 million will be available starting in fiscal year 2022, which begins Oct. 1. He says the funds will be created to help expand meat processing capacity, and will most likely come in the form of grants to small and medium operations.

"Even in today’s Washington, that’s a lot of taxpayer revenue funding," says Wiesemeyer. "Let’s hope there is not loads of red tape involved in participating, like current grants."

What Does it Cost to Build a Small to Medium Size Meat Processing Plant? 

What does it cost to start a meat processing plant from scratch? It varies. Wiesemeyer says small meat processing plants can cost $1 million, which means the $500 million could go a long way in expanding meat processing capacity across the country.

However, a current meat processing plant being built in the Midwest, which will have the capacity to process up to 40 head of cattle per week and 80 hogs, is costing around $8 million to build today. A smaller facility that recently opened, which processes 50 head of cattle per week and tapped into technology to help the quality of meat processed, came in at a price tag of $3 million. 

Additional Announcements/Biden's Executive Order

Vilsack's announcement is scheduled to happen after President Biden is scheduled to sign an Executive Order Friday, which could have a sweeping impact on U.S. agriculture. The order includes changes to fight anti-competitive practices in agriculture, including the controversial "Right to Repair" topic. Overall, the White House says the executive order will include 72 initiatives by more than one dozen agencies to "tackle some of the most pressing competition problems across our economy."

Included in the Fact Sheet released by the White House Friday morning, the 72 initiatives include:

• Save Americans money on their internet bills by banning excessive early termination fees, requiring clear disclosure of plan costs to facilitate comparison shopping, and ending landlord exclusivity arrangements that stick tenants with only a single internet option.
• Make it easier and cheaper to repair items you own by limiting manufacturers from barring self-repairs or third-party repairs of their products.
• Empower family farmers and increase their incomes by strengthening the Department of Agriculture’s tools to stop the abusive practices of some meat processors.
• Increase opportunities for small businesses by directing all federal agencies to promote greater competition through their procurement and spending decisions.

President Biden is set to sign the executive order at the White House at 1:30 p.m. ET Friday, according to his schedule. USDA says VIlsack's press conference will then take place at 2 p.m. and will be live-streamed. You can watch it below.

Wiesemeyer reports it's not just a focus on expanding competition in meat processing that will come out of the Iowa and Nebraska trip today. He says Vilsack could also unveil details about planned changes to the "Product of the USA" label for meat products. A Reuters report earlier this week said the Biden administration planned to sign an executive order, which would include the labeling piece. 

According to Wiesemeyer, details of the planned executive order and announcement will be key. 

"If not done right, Canada will not hesitate to retaliate," says Wiesemeyer. "And perhaps Vilsack will provide needed details on another frequent topic: putting more teeth, or enforcement, in the Packers and Stockyards Act."